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Poverty, Choice and Legitimacy


  • Peter Saunders


This paper begins by arguing that the 'poverty measurement debate' has become bogged down in the poverty statistics and has failed to evolve into a consideration of the causes and consequences of poverty. In order to redress this imbalance, it is necessary to develop poverty measures that lead more naturally in these directions. It is argued that poverty can be given a meaning from two different perspectives, the first focusing on what poverty means to those who study it, and the second focusing on what it means to those who actually experience it. In attempting to shed some light on the latter interpretation, the paper presents some survey data in which DSS clients indicate what poverty means to them. the paper then explores three different approaches to measuring poverty, each of which draws on the two key features of poverty, that it is a situation in which choice is severely restricted, and that there must be some socially determined relevance to any poverty measure. The first method estimates and compares poverty using both income and expenditure data as a way of better understanding the choices and circumstances of the poor. The second estimates a poverty line income as a situation where all resources must be devoted to meeting immediate consumable needs and where there are no expenditures on durable and luxury items. The third method, budget standards, is described briefly from the pespective developed in the paper with the aim of highlighting how budget standards research addresses issues of choice and social relevance.

Suggested Citation

  • Peter Saunders, 1997. "Poverty, Choice and Legitimacy," Discussion Papers 0076, University of New South Wales, Social Policy Research Centre.
  • Handle: RePEc:wop:sprcdp:0076

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    References listed on IDEAS

    1. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    2. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    3. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
    4. Case, Anne C, 1991. "Spatial Patterns in Household Demand," Econometrica, Econometric Society, vol. 59(4), pages 953-965, July.
    5. Boyd Hunter, 1995. "The Social Structure of the Australian Urban Labour Market: 1976-1991," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 28(2), pages 65-79.
    6. Thursby, Jerry G., 1992. "A comparison of several exact and approximate tests for structural shift under heteroscedasticity," Journal of Econometrics, Elsevier, vol. 53(1-3), pages 363-386.
    7. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    8. Gregory, R.G. & Hunter, B., 1995. "The Macro Economy and the Growth of Ghettos and Urban Poverty in Australia," CEPR Discussion Papers 325, Centre for Economic Policy Research, Research School of Economics, Australian National University.
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    Cited by:

    1. Gary Marks, 2005. "Dynamics of Financial Disadvantage," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 12(4), pages 309-322.
    2. Michael Hurd & Susann Rohwedder, 2006. "Consumption and Economic Well-Being at Older Ages: Income- and Consumption-Based Poverty Measures in the HRS," Working Papers wp110, University of Michigan, Michigan Retirement Research Center.
    3. Michael D. Hurd & Susann Rohwedder, 2006. "Economic Well-Being at Older Ages: Income- and Consumption-Based Poverty Measures in the HRS," NBER Working Papers 12680, National Bureau of Economic Research, Inc.

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